NZ mirrors the US in significant ways

And it matters.

Catching you up on the morning’s global news and a quick look at the parallels -

GLOBAL

Tariffs are back

• Sharemarkets in the US, UK and Europe have “plunged” in response to Trump’s tariffs. And while Mexico has won a one month reprieve, Canada and China will see their respective 25% and 10% tariffs start on Tuesday.

• Investors and businesses are on edge, with Wall Street Journal (WSJ) calling this “the dumbest trade war in history” while Rupert Murdoch’s other arm (Fox News) salutes Trump’s strength.

• Kathleen Brooks, the research director at XTB:

  • “It’s too early to know exactly what impact tariffs will have on the global economy, but it is fair to say that they have a high potential of triggering inflation, and weighing heavily on global growth, including the US economy.”

• The major impacts currently projected are around inflation, GDP, currency and interest rates, as countries vie to re-fit the pieces of the new gaps - although specifics are yet to sharpen.

• In Europe, Starmer is tapping down suggestions of UK tariffs, hoping they are excluded, even as Trump warns that the EU is next.

• Europe will retaliate of course, with France’s Macron confirming that if the US “attacked in terms of trade ... [the EU] will have to stand up for itself and therefore react.”

USAID may die - does it matter?

• Trump is reportedly due to close down USAID, the U.S. Agency for International Development.

• Established by John F. Kennedy in 1961 originally to counter Soviet influence, it’s the largest humanitarian organisation in the world - addressing international poverty, combatting terrorism, funding NGOs, helping climate action, anti-corruption, independent media, women, health programs such as combatting Ebola in Africa, natural disaster relief etc.

• It included aid to Ukraine - prosthetic limbs for soldiers, special rehabilitation etc.

• In short - it recognises that global security and values affect America’s prosperity and security.

• So despite what Trump voters may believe, it’s not a purely beneficient enterprise. And for that reason, traditionally enjoyed bipartisan support.

• No more.

• On the weekend, Musk called it a “criminal organisation”. Two of its top officials were put on administrative leave after refusing to give Elon Musk’s team access to its confidential systems; its website has been taken down, and the rest of staff have been told to stay home.

• It’d be illegal to shut it down without Congress approval, but there are other options for Trump’s team e.g. by folding it into another department.

• Senator Chris Murphy, a Democrat wrote: "The immediate consequences of this are cataclysmic. Malnourished babies who depend on U.S. aid will die. Anti-terrorism programs will shut down and our most deadly enemies will get stronger. Diseases that threaten the U.S. will go unabated and reach our shores faster. And China will fill the void."

• Russia is also celebrating:

This is all being actioned as part of Elon Musk’s ostensible “government efficiency” drive.

But the US’s foreign aid program in recent years is well under 1% of GDP - and far below comparable wealthy countries.

The idea of it all is clear - as you elevate and improve markets, neighbours and countries, your own trade opportunities improve, defence budgets can be less than otherwise needed, the health of your citizens is protected from e.g. foreign contagions, you can forge strategic alliances for security and partnership, and terrorism can be deterred by elevating living standards across the world - and so on.

It’s a fairly significant return for 0.4% of your GDP and includes preventative returns.

Importantly - attacking USAID was ear-marked well before the election in the Heritage Foundation Project 2025 handbook.

Although Musk has gone further in now attempting to dismantle it entirely, Project 2025’s plans for USAID would have merely re-purposed it for their new world order.

Included in their manifesto was directing USAID to strengthen “free market” pro-property rights, low taxes, and low regulation environments around the world, as well as dismantling environmental commitments, and supporting the fossil fuel industry.

Does that sound humanitarian like?

In other words it reads eerily like much of the present NZ Government’s agenda.

ON CLIMATE

ON STRATEGY

So does it matter?

Of course it does.

But the point is - it would have been done for regardless.

As soon as Trump won (or any other current Republican, including Peter Thiel’s in waiting candidate, JD Vance), whether USAID stays in physical formation or not, its core purpose, resourcing and agenda would have radically changed.

In New Zealand, our Waitangi Tribunal, a part of the NZ court system i.e judiciary, experienced a similar “do-over” when the Government backed down from disbanding it, and instead took out its strongest and most knowledgeable members.

i.e. Where there is a will, there is a way for the agenda running the tracks.

Parallels continue

• Donald J Trump has also announced he wants to formally promote a “colour blind” and “merit based” society and there are only two genders.

• This echoes the rhetoric of New Zealand’s current right wing government and on race, epitomises the ideologies promoted by wealthy Kiwis such as Wayne Wright Junior who told Duncan Grieve a few years ago: “I would say that if a particular group of people feel aggrieved, then make something of it. Get out there and do it”, emphasising he only wanted “merit based” hires for The Platform.

• And “I don’t think the answer to [poor outcomes for Maori] is carving them out, and giving them extraordinary rights and privileges, because they don’t live as long… The fact that a group doesn’t live as long… is not inherent racism.”

• It also echoes another much, much, much wealthier Kiwi citizen - American Peter Thiel, who has been arguing for over 30 years, that diversity is misguided, and no policies should be devised based on race. A 2021 biography of Thiel, called The Contrarian, alleged that as a student at Stanford he defended apartheid as “economically sound”.

• Thiel argues: “The basic problem is that a racist past cannot be undone through more racism.” Sound familiar?

• The Guardian also notes German born Peter Thiel was educated in a southern African city in the 1970s where Hitler was still openly venerated. And he is critical of welfare programs and women being permitted to vote as undermining capitalism.

• Thiel’s biographer told Times in 2021 that Thiel made Zuckerberg and Facebook what it is (he was the first outside investor in it), is “hostile to democracy”, and “is very committed to the idea of being able to say the unpopular thing.”

• That’s what drew Thiel to Trump, and perhaps locally, we might find a few politicians vying for that award too.

Drill baby, Drill

Another term we saw used in the US recently is “Drill baby, Drill.”

Where have I seen that before?

SUMMARY

When the money is this large, and the individuals this powerful, how will NZ’s resilience hold up?

Still, we will see the US fail in the next few years, and perhaps that will bring some respite to the free market, pro-property rights, anti-environment and anti-progressive ideology dream currently taking place around us.